RT Journal Article
SR Electronic
T1 HIFO by Asset Type
JF The Journal of Wealth Management
FD Institutional Investor Journals
SP jwm.2018.1.061
DO 10.3905/jwm.2018.1.061
A1 Yuntaek Pae
A1 Robert J. Atra
YR 2018
UL https://pm-research.com/content/early/2018/03/31/jwm.2018.1.061.1.abstract
AB The article investigates the benefit of highest-in, first-out (HIFO) accounting when selling shares of various asset classes. The tax benefit of HIFO accounting is statistically and economically significant. NASDAQ, emerging market, and real estate indexes earn greater HIFO tax benefits than other types of assets, with the bond index having the least benefit. While the results themselves give practitioners some information about the benefit of share accounting, they are useful in other aspects of financial planning, such as after-tax asset allocation and asset tax location.